It looks like mega pharmaceutical companies are jumping aboard the “recession insuranceâ€ bandwagon. A few months ago, I blogged about companies (mostly auto makers) offering to cover monthly payments in case of job loss. Well, those taking prescription drugs can rest easy since many drug makers are have joined the brigade, expanding their prescription benefits in light of the current economy.
Since the recession, more patients have been turning to pharmaceutical companies’ financial assistance programs, says PhRMA, a drug trade group. In October, Merck upped the household income eligibility to $88,000 for a family of four with no insurance as part of its program. It was previously $44,100. Accordingly, other drug companies such as Abbott, Amgen, and Wyeth have also recently expanded patient assistance programs.
But the most comprehensive of the bunch looks like Pfizer’s free drug program, MAINTAIN.
The program includes more than 70 of the company’s most popular drugs for up to 12 months or until subscribers become re-insured (whichever comes first). Covered drugs include the impotency pill, Viagra; cholesterol fighter, Lipitor; and painkiller, Celebrex along with some diabetes drugs, antibiotics, antidepressants, heart medications, contraceptives, and smoking cessation products.
The offer is extended to customers who became in January 2009 or later, lack prescription drug coverage, were taking a prescribed Pfizer drug for at least three months prior to losing their job, or face financial hardship. Those who take Pfizer drugs have until December to sign up for the free program.
“We thought there must be some way we could help recently unemployed people who are taking Pfizer medicines to continue treatment during these challenging economic times,â€ said Dr. Jorge Puente, Pfizer’s regional president of worldwide pharmaceuticals.
And what would charity from a multibillion-dollar cooperate titan be without some sort of mutual benefit. For Pfizer, it’s part politics, part economics. With the healthcare debate heating up on Capital Hill, this move is sure to buy the company some goodwill as government seeks to restructure the industry.
Also, it’s no secret that Pfizer’s profit has taken a hit as patents on many of their popular drugs — including some of the aforementioned — expire and cheaper generic version hit the market.
Here’s the economics: Create loyal customers. In theory, when it comes to brand loyalty, no matter how inexpensive and equal in quality the alternative is, the “brandâ€ is so strong that customers will not part. But as consumers seek to cut costs in every possible way that theory may not prove in practice this time around.
Furthermore, as the Associated Press points out, this will help the company move inventory that otherwise would not have been sold since subscribers have moved to cheaper drugs. And, anyone who files taxes knows, the cost of the program, which according to the same article, has not been determined by Pfizer yet, will be defrayed by tax deductions. Companies that donate inventory can deduct their cost to make the product plus one-half the difference between their cost and the selling price from their taxable income. Pfizer is running the program through its charitable foundations.
Whatever the benefits may be, this is still a good program for people who do not have the funds to cover exorbitant prescription drugs.
Renita Burns is the editorial assistant for BlackEnterprise.com.